Minnesota
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0-53713
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27-0383995
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(State or other jurisdiction
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(Commission
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(I.R.S. Employer
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of incorporation)
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File Number)
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Identification No.)
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215 South Cascade Street, P.O. Box 496, Fergus Falls, MN
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56538-0496
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(Address of principal executive offices)
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(Zip Code)
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(d)
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Exhibits
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99.1
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Press Release issued February 6, 2012.
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OTTER TAIL CORPORATION
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||
Date: February 7, 2012
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||
By
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/s/ Kevin G. Moug
|
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Kevin G. Moug
|
||
Chief Financial Officer
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Exhibit
|
Description of Exhibit
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99.1
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Press release, dated February 6, 2012
|
![]() |
|
NEWS RELEASE |
Media contact:
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Michael J. Olsen, Sr. Vice President of Corporate Communications, (701) 451-3580 or (866) 410-8780
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Investor contact:
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Loren Hanson, Manager of Investor Relations, (218) 739-8481 or (800) 664-1259
|
For release: | February 6, 2012 | Financial Media |
●
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Divestures of Idaho Pacific Holdings, Inc. (IPH), E.W. Wylie Corporation (Wylie) and Aviva Sports, Inc. (Aviva) bolster strategy to reduce corporation’s risk profile
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●
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Consolidated revenues rose 20.8% to $1.1 billion compared with $0.9 billion in 2010
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●
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Consolidated operating income rose to $52.3 million from $24.1 million in 2010
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●
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Consolidated net income from continuing operations increased to $17.1 million from a net loss of $10.8 million in 2010
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●
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Consolidated net losses from continuing and discontinued operations totaled $13.2 million compared with $1.3 million for 2010
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●
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Earnings (Loss) per share from continuing operations were $0.46 compared with ($0.32) per share in 2010, including discontinued operations, net (loss) per share was ($0.40) compared with ($0.06) in 2010
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●
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On February 6, 2012 the corporation entered into an agreement to sell DMS Health Technologies, Inc. (DMS), with closing expected to occur by February 29, 2012, subject to certain closing conditions. Results for the year were impacted by a $39.1 million net-of-tax impairment charge in the fourth quarter in the Health Services segment based on the terms of the agreement.
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●
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a $3.1 million reduction in fuel cost recovery revenues related to lower fuel and purchased power costs incurred in 2011 for reasons indicated below,
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●
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a $0.8 million decrease in accrued and recovered conservation improvement program revenues and incentives, and
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●
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a $0.6 million reduction in Minnesota retail revenues related to an increase in rates that was more than offset by a refund of excess amounts collected under interim rates in effect from June 2010 through September 2011.
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●
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a $2.0 million increase in revenue related to a 0.7% increase in kilowatt-hour (kwh) sales,
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●
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a $0.8 million increase in revenues related to the recovery of the North Dakota portion of Big Stone II plant abandonment costs, and
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●
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a $0.7 million increase in renewable resource and transmission cost recovery revenues related to an increase in transmission costs eligible for recovery under Minnesota and North Dakota transmission cost recovery riders.
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●
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a $3.5 million increase in transmission tariff revenues as a result of increased use of company-owned transmission assets by others,
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●
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a $1.1 million payment received by Otter Tail Energy Services Company (OTESCO) in the first quarter of 2011 for access rights through an OTESCO wind farm development site, and
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●
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a $1.1 million refund in 2010 of revenues collected from Otter Tail Power Company’s Big Stone II project partners in years prior to 2010.
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●
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a $1.7 million increase in transmission tariff charges related to the increase in kwhs purchased from other generators to serve retail customers,
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●
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a $1.0 million increase in labor costs related to increased health benefit costs,
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●
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a $1.0 million increase in generation plant maintenance costs related to the Big Stone Plant overhaul in fall 2011 and increased maintenance costs at the Langdon wind farm and Coyote Station,
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●
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a $0.9 million increase in expense related to the amortization of the North Dakota portion of Big Stone II plant abandonment costs, which Otter Tail Power Company began recovering in August 2010
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●
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a $0.8 million increase in Minnesota conservation improvement program costs related to mandated increases in conservation expenditures in Minnesota,
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●
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a $0.8 million increase in property taxes due to valuation increases and increases in local property tax rates on Minnesota property, and
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●
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a $0.7 million increase in transportation costs related to increases in gasoline and diesel fuel prices.
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●
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At BTD, revenues increased $44.7 million and net income increased $3.1 million as a result of higher sales volume due to improved customer demand for products and services.
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●
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At ShoreMaster, revenues increased $4.7 million due to increased sales of both residential and commercial products. An $18.5 million decrease in net losses between the years mainly reflects a $15.3 million (net-of-tax) asset impairment charge taken in 2010, but also includes a $3.9 million decrease in other operating expenses before tax between the years.
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●
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At T.O. Plastics, revenues increased by $1.7 million, mainly as a result of increased sales of horticultural products, while net income remained unchanged as the increase in revenue was completely offset by higher material and overhead costs.
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For the Year Ended December 31, 2011
|
||||||||||||||||||||||||
(in thousands)
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IPH
|
Wylie
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Aviva
|
DMS
|
Intercompany
transactions
adjustment
|
Total
|
||||||||||||||||||
Operating Revenues
|
$ | 28,125 | $ | 49,884 | $ | 2,206 | $ | 89,558 | $ | (4,119 | ) | $ | 165,654 | |||||||||||
Operating Expenses
|
24,046 | 55,927 | 3,976 | 85,244 | (4,119 | ) | 165,074 | |||||||||||||||||
Asset Impairment Charge
|
-- | -- | 456 | 56,379 | 56,835 | |||||||||||||||||||
Other Income (Deductions)
|
(228 | ) | 18 | (18 | ) | 281 | (3 | ) | 50 | |||||||||||||||
Interest Expense
|
11 | 709 | 379 | 1,726 | (2,772 | ) | 53 | |||||||||||||||||
Income Tax Expense (Benefit)
|
1,462 | (2,683 | ) | (1,050 | ) | (16,058 | ) | 1,108 | (17,221 | ) | ||||||||||||||
Net Income (Loss) from Operations
|
2,378 | (4,051 | ) | (1,573 | ) | (37,452 | ) | 1,661 | (39,037 | ) | ||||||||||||||
Gain (Loss) on Disposition Before Taxes
|
15,471 | (946 | ) | -- | -- | 14,525 | ||||||||||||||||||
Income Tax Expense on Disposition
|
2,997 | 2,854 | -- | -- | 5,851 | |||||||||||||||||||
Net Gain (Loss) on Disposition
|
12,474 | (3,800 | ) | -- | -- | 8,674 | ||||||||||||||||||
Net Income (Loss)
|
$ | 14,852 | $ | (7,851 | ) | $ | (1,573 | ) | $ | (37,452 | ) | $ | 1,661 | $ | (30,363 | ) |
For the Year Ended December 31, 2010
|
||||||||||||||||||||||||
(in thousands)
|
IPH
|
Wylie
|
Aviva
|
DMS
|
Intercompany
transactions
adjustment
|
Total
|
||||||||||||||||||
Operating Revenues
|
$ | 77,412 | $ | 54,143 | $ | 2,704 | $ | 100,301 | $ | (3,601 | ) | $ | 230,959 | |||||||||||
Operating Expenses
|
65,261 | 52,311 | 3,200 | 98,794 | (3,601 | ) | 215,965 | |||||||||||||||||
Asset Impairment Charge
|
-- | -- | 489 | -- | 489 | |||||||||||||||||||
Other Income (Deductions)
|
(326 | ) | 8 | (10 | ) | 331 | 3 | |||||||||||||||||
Interest Expense
|
111 | 522 | 346 | 1,289 | (2,176 | ) | 92 | |||||||||||||||||
Income Tax Expense (Benefit)
|
3,716 | 511 | (532 | ) | 369 | 870 | 4,934 | |||||||||||||||||
Net Income (Loss)
|
$ | 7,998 | $ | 807 | $ | (809 | ) | $ | 180 | $ | 1,306 | $ | 9,482 |
●
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a threshold level of net earnings and a return on invested capital in excess of the corporation's weighted average cost of capital,
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●
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a strategic differentiation from competitors and a sustainable cost advantage,
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●
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a stable or growing industry
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●
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an ability to quickly adapt to changing economic cycles, and
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●
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a strong management team committed to operational excellence.
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●
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a $39.1 million net-of-tax asset impairment charge at DMS resulting from the write down of DMS to its fair value based on DMS’s indicated sales price, and
|
●
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a $3.8 million after-tax loss on the sale of Wylie.
|
Low
|
High
|
|||||||
Electric
|
$1.05 | $1.10 | ||||||
Wind Energy
|
$(0.15 | ) | $0.00 | |||||
Manufacturing
|
$0.30 | $0.35 | ||||||
Construction
|
$0.02 | $0.07 | ||||||
Plastics
|
$0.06 | $0.11 | ||||||
Corporate
|
$(0.28 | ) | $(0.23 | ) | ||||
Totals
|
$1.00 | $1.40 |
●
|
The corporation expects net income to increase slightly in its Electric segment in 2012 compared with 2011. This is based on new rates being in place in Minnesota for a full year, rider recovery increases and an increase in capitalized interest costs related to larger construction expenditures, offset by lower conservation improvement program incentives and increases in operating and maintenance expenses due to higher benefit costs.
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●
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The corporation expects significant improvement in operations from its Wind Energy segment in 2012. DMI has been able to stabilize production, improve productivity, align headcount with current production demands and eliminate the need for outsourced quality assurance staffing. Order backlog will continue to support current plant staffing at DMI’s Tulsa and West Fargo plants. DMI continues to experience increased pricing pressure on new orders due to overcapacity in the U.S. market and significantly lower steel costs available to Asian manufacturers. Potential exposure to liquidated damages, warranty claims, or remediation costs related to past production issues remain. Backlog in the Wind Energy segment is $154 million for 2012 compared with $157 million one year ago.
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●
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The corporation expects earnings from its Manufacturing segment to improve in 2012 due to the following factors:
|
o
|
Increased order volume and continuing improvement in economic conditions in the industries BTD serves
|
o
|
Improved performance at ShoreMaster as a result of bringing costs in line with current revenue levels, the sale of Aviva and the closure of ShoreMaster’s Camdenton, Missouri plant with relocation of Camdenton’s commercial production operations to ShoreMaster’s Fergus Falls, Minnesota and St. Augustine, Florida facilities
|
o
|
Stable earnings from T.O. Plastics
|
o
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Backlog for the manufacturing companies of approximately $121 million for 2012 compared with $86 million one year ago
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●
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The corporation expects higher net income from its Construction segment in 2012 as it has implemented improved cost control processes in construction management and selectively bid on projects with the potential for higher margins. Backlog in place for the construction businesses is $106 million for 2012 compared with $164 million one year ago.
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●
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The corporation expects a slight decrease in Plastics segment net income in 2012.
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Corporate general and administrative costs are expected to remain relatively flat between the years.
|
(in millions)
|
2011
|
2012
|
2013
|
2014
|
2015
|
2016
|
||||||||||||||||||
Capital Expenditures:
|
||||||||||||||||||||||||
Electric Segment:
|
||||||||||||||||||||||||
Transmission
|
$ | 47 | $ | 34 | $ | 36 | $ | 50 | $ | 59 | ||||||||||||||
Environmental
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31 | 86 | 78 | 70 | -- | |||||||||||||||||||
Other
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39 | 50 | 50 | 50 | 50 | |||||||||||||||||||
Total Electric Segment
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$ | 50 | $ | 117 | $ | 170 | $ | 164 | $ | 170 | $ | 109 | ||||||||||||
Nonelectric Segments
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24 | 15 | 15 | 21 | 19 | 23 | ||||||||||||||||||
Total Capital Expenditures
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$ | 74 | $ | 132 | $ | 185 | $ | 185 | $ | 189 | $ | 132 | ||||||||||||
Total Electric Utility Average Rate Base
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$ | 653 | $ | 686 | $ | 789 | $ | 904 | $ | 1,036 | $ | 1,117 |
●
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The corporation is subject to federal and state legislation, regulations and actions that may have a negative impact on its business and results of operations.
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Federal and state environmental regulation could require the corporation to incur substantial capital expenditures and increased operating costs.
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Volatile financial markets and changes in the corporation’s debt ratings could restrict its ability to access capital and could increase borrowing costs and pension plan and postretirement health care expenses.
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The corporation relies on access to both short- and long-term capital markets as a source of liquidity for capital requirements not satisfied by cash flows from operations. If the corporation is not able to access capital at competitive rates, its ability to implement its business plans may be adversely affected.
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The corporation may, from time to time, sell one or more of its nonelectric businesses to provide capital to fund investments in its electric utility business or for other corporate purposes, which could result in the recognition of a loss on the sale of any business sold.
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The corporation may experience fluctuations in revenues and expenses related to its operations, which may cause its financial results to fluctuate and could impair its ability to make distributions to its shareholders or scheduled payments on its debt obligations, or to meet covenants under its borrowing agreements.
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Disruptions, uncertainty or volatility in the financial markets can also adversely impact the corporation’s results of operations, the ability of its customers to finance purchases of goods and services, and its financial condition, as well as exert downward pressure on stock prices and/or limit its ability to sustain its current common stock dividend level.
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The corporation is not currently required to make any contributions to its defined benefit pension plan in 2012. The corporation made a discretionary contribution to the plan of $10.0 million in January 2012. The corporation could be required to contribute additional capital to the pension plan in future years if the market value of pension plan assets significantly declines in the future, plan assets do not earn in line with the corporation’s long-term rate of return assumptions or relief under the Pension Protection Act is no longer granted.
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Any significant impairment of the corporation’s goodwill would cause a decrease in its asset values and a reduction in its net operating income.
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A sustained decline in the corporation’s common stock price below book value or declines in projected operating cash flows at any of its operating companies may result in goodwill impairments that could adversely affect its results of operations and financial position, as well as financing agreement covenants.
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The inability of the corporation’s subsidiaries to provide sufficient earnings and cash flows to allow the corporation to meet its financial obligations and debt covenants and pay dividends to its shareholders could have an adverse effect on the corporation.
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Economic conditions could negatively impact the corporation’s businesses.
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If the corporation is unable to achieve the organic growth it expects, its financial performance may be adversely affected.
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The corporation’s plans to realign its diversified business mix through dispositions may not be successful, which could result in poor financial performance.
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The corporation’s plans to operate its nonelectric businesses could be limited by state law.
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The corporation’s subsidiaries enter into production and construction contracts, including contracts for new product designs, which could expose them to unforeseen costs and costs not within their control, which may not be recoverable and could adversely affect the corporation’s results of operations and financial condition.
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●
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Significant warranty claims in excess of amounts normally reserved for such items could adversely affect the corporation’s results of operations and financial condition. Also, expenses associated with remediation activities in the Wind Energy segment could be substantial. The potential exists for multiple claims based on one defect repeated throughout the production process or for claims where the cost to repair or replace the defective part is highly disproportionate to the original cost of the part. If the corporation is required to cover remediation expenses in addition to regular warranty coverage, the corporation could be required to accrue additional expenses and experience additional unplanned cash expenditures which could adversely affect the corporation’s consolidated results of operations and financial condition.
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●
|
The corporation is subject to risks associated with energy markets.
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The corporation is subject to risks and uncertainties related to the timing and recovery of deferred tax assets which could have a negative impact on the corporation’s net income in future periods.
|
●
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Certain of the corporation’s operating companies sell products to consumers that could be subject to recall.
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Competition is a factor in all of the corporation’s businesses.
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●
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Actions by the regulators of the corporation’s electric operations could result in rate reductions, lower revenues and earnings or delays in recovering capital expenditures.
|
●
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Otter Tail Power Company could be required to absorb a disproportionate share of costs for investments in transmission infrastructure required to provide independent power producers access to the transmission grid. These costs may not be recoverable through a transmission tariff and could result in reduced returns on invested capital and/or increased rates to Otter Tail Power Company's retail electric customers.
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●
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Otter Tail Power Company’s electric generating facilities are subject to operational risks that could result in unscheduled plant outages, unanticipated operation and maintenance expenses and increased power purchase costs.
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Wholesale sales of electricity from excess generation could be affected by reductions in coal shipments to the Big Stone and Hoot Lake plants due to supply constraints or rail transportation problems beyond the corporation’s control.
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Changes to regulation of generating plant emissions, including but not limited to carbon dioxide (CO2) emissions, could affect Otter Tail Power Company’s operating costs and the costs of supplying electricity to its customers.
|
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The U.S. wind industry is reliant on tax and other economic incentives and political and governmental policies. A significant change in these incentives and policies could negatively impact the corporation’s results of operations and growth.
|
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The corporation’s wind tower manufacturing business is substantially dependent on a few significant customers.
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Prolonged periods of low utilization of DMI’s wind tower production plants, due to a continuing softening of demand for its product, could cause DMI to idle certain facilities. Should this softened demand for wind towers continue, these events may result in impairment charges on certain of DMI’s facilities if future cash flow estimates, based on information available to management at the time, indicate that the plants carrying values may not be recoverable or, if any plant assets are sold below their carrying values, significant losses may be incurred.
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●
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Competition from foreign and domestic manufacturers, cost management in a fixed price contract project environment, the price and availability of raw materials, the ability of suppliers to deliver materials at contracted prices, fluctuations in foreign currency exchange rates and general economic conditions could affect the revenues and earnings of the corporation’s wind energy and manufacturing businesses.
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A significant failure or an inability to properly bid or perform on projects by the corporation’s wind energy, construction or manufacturing businesses could lead to adverse financial results and could lead to the possibility of delay or liquidated damages.
|
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The corporation’s plastic pipe companies compete against a large number of other manufacturers of PVC pipe and manufacturers of alternative products. Customers may not distinguish the pipe companies’ products from those of its competitors.
|
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Reductions in PVC resin prices can negatively impact PVC pipe prices, profit margins on PVC pipe sales and the value of PVC pipe held in inventory.
|
Otter Tail Corporation
|
||||||||||||||||
Consolidated Statements of Income
|
||||||||||||||||
In thousands, except share and per share amounts
|
||||||||||||||||
Quarter Ended
December 31,
|
Year-to-Date
December 31,
|
|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Operating Revenues by Segment
|
||||||||||||||||
Electric
|
$ | 87,928 | $ | 86,085 | $ | 342,727 | $ | 344,379 | ||||||||
Wind Energy
|
47,313 | 37,666 | 201,921 | 143,603 | ||||||||||||
Manufacturing
|
58,810 | 47,496 | 227,116 | 175,986 | ||||||||||||
Construction
|
44,762 | 49,414 | 184,657 | 134,222 | ||||||||||||
Plastics
|
24,587 | 20,383 | 123,669 | 96,945 | ||||||||||||
Corporate Revenue and Intersegment Eliminations
|
(369 | ) | (928 | ) | (2,240 | ) | (2,944 | ) | ||||||||
Total Operating Revenues
|
263,031 | 240,116 | 1,077,850 | 892,191 | ||||||||||||
Operating Expenses
|
||||||||||||||||
Fuel and Purchased Power
|
28,972 | 29,549 | 112,468 | 117,890 | ||||||||||||
Nonelectric Cost of Goods Sold (depreciation included below)
|
155,959 | 132,695 | 646,696 | 470,844 | ||||||||||||
Electric Operating and Maintenance Expense
|
33,908 | 29,499 | 126,053 | 121,538 | ||||||||||||
Nonelectric Operating and Maintenance Expense
|
17,527 | 17,105 | 66,731 | 69,195 | ||||||||||||
Asset Impairment Charge
|
3,613 | -- | 3,613 | 19,251 | ||||||||||||
Depreciation and Amortization
|
17,738 | 17,578 | 70,000 | 69,399 | ||||||||||||
Total Operating Expenses
|
257,717 | 226,426 | 1,025,561 | 868,117 | ||||||||||||
Operating Income (Loss) by Segment
|
||||||||||||||||
Electric
|
14,400 | 16,907 | 63,453 | 64,710 | ||||||||||||
Wind Energy
|
(5,510 | ) | (5,186 | ) | (19,763 | ) | (16,044 | ) | ||||||||
Manufacturing
|
1,383 | 3,142 | 15,987 | (13,297 | ) | |||||||||||
Construction
|
(3,003 | ) | 1,295 | (2,892 | ) | (506 | ) | |||||||||
Plastics
|
1,696 | 2,068 | 10,951 | 5,475 | ||||||||||||
Corporate
|
(3,652 | ) | (4,536 | ) | (15,447 | ) | (16,264 | ) | ||||||||
Total Operating Income
|
5,314 | 13,690 | 52,289 | 24,074 | ||||||||||||
Interest Charges
|
8,508 | 9,282 | 35,818 | 36,940 | ||||||||||||
Other Income
|
1,192 | 102 | 2,736 | 1,057 | ||||||||||||
Income Tax Expense (Benefit) – Continuing Operations
|
(1,448 | ) | 6,080 | 2,087 | (983 | ) | ||||||||||
Net Income (Loss) by Segment – Continuing Operations
|
||||||||||||||||
Electric
|
9,458 | 10,369 | 38,886 | 34,557 | ||||||||||||
Wind Energy
|
(6,326 | ) | (11,856 | ) | (21,894 | ) | (22,035 | ) | ||||||||
Manufacturing
|
821 | 1,662 | 7,614 | (13,956 | ) | |||||||||||
Construction
|
(1,884 | ) | 691 | (2,204 | ) | (646 | ) | |||||||||
Plastics
|
903 | 1,135 | 5,811 | 2,515 | ||||||||||||
Corporate
|
(3,526 | ) | (3,571 | ) | (11,093 | ) | (11,261 | ) | ||||||||
Net (Loss) Income from Continuing Operations
|
(554 | ) | (1,570 | ) | 17,120 | (10,826 | ) | |||||||||
Discontinued Operations
|
||||||||||||||||
(Loss) Income - net of Income Tax (Benefit) Expense
|
||||||||||||||||
of ($38), $1,415, $223 and $5,130 for the respective periods
|
(66 | ) | 3,626 | 354 | 9,775 | |||||||||||
Impairment Loss - net of Income Tax (Benefit)
|
||||||||||||||||
of ($17,444), $0, ($17,444) and ($196) for the respective periods
|
(39,391 | ) | -- | (39,391 | ) | (293 | ) | |||||||||
(Loss) Gain on Disposition - net of Income Tax Expense
|
||||||||||||||||
of $2,638, $0, $5,851 and $0 for the respective periods
|
(4,124 | ) | -- | 8,674 | -- | |||||||||||
Net (Loss) Income from Discontinued Operations
|
(43,581 | ) | 3,626 | (30,363 | ) | 9,482 | ||||||||||
Total Net (Loss) Income
|
(44,135 | ) | 2,056 | (13,243 | ) | (1,344 | ) | |||||||||
Preferred Dividend Requirement and Other Adjustments
|
184 | 183 | 1,058 | 833 | ||||||||||||
Balance for Common
|
$ | (44,319 | ) | $ | 1,873 | $ | (14,301 | ) | $ | (2,177 | ) | |||||
Average Number of Common Shares Outstanding
|
||||||||||||||||
Basic
|
35,952,639 | 35,807,967 | 35,922,155 | 35,783,555 | ||||||||||||
Diluted
|
35,952,639 | 36,036,111 | 35,922,155 | 35,783,555 | ||||||||||||
Basic Earnings Per Common Share:
|
||||||||||||||||
Continuing Operations (net of preferred dividend requirement)
|
$ | (0.02 | ) | $ | (0.05 | ) | $ | 0.46 | $ | (0.32 | ) | |||||
Discontinued Operations (net of other adjustments)
|
(1.21 | ) | 0.10 | (0.86 | ) | 0.26 | ||||||||||
$ | (1.23 | ) | $ | 0.05 | $ | (0.40 | ) | $ | (0.06 | ) | ||||||
Diluted Earnings Per Common Share:
|
||||||||||||||||
Continuing Operations (net of preferred dividend requirement)
|
$ | (0.02 | ) | $ | (0.05 | ) | $ | 0.46 | $ | (0.32 | ) | |||||
Discontinued Operations (net of other adjustments)
|
(1.21 | ) | 0.10 | (0.86 | ) | 0.26 | ||||||||||
$ | (1.23 | ) | $ | 0.05 | $ | (0.40 | ) | $ | (0.06 | ) |
Otter Tail Corporation
|
||||||||
Consolidated Balance Sheets
|
||||||||
ASSETS
|
||||||||
in thousands
|
||||||||
December 31,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
Current Assets
|
||||||||
Cash and Cash Equivalents
|
$ | 14,652 | $ | -- | ||||
Accounts Receivable:
|
||||||||
Trade—Net
|
116,522 | 94,971 | ||||||
Other
|
18,807 | 18,283 | ||||||
Inventories
|
77,983 | 72,009 | ||||||
Deferred Income Taxes
|
12,307 | 10,028 | ||||||
Accrued Utility and Cost-of-Energy Revenues
|
13,719 | 13,936 | ||||||
Costs and Estimated Earnings in Excess of Billings
|
67,109 | 67,352 | ||||||
Income Taxes Receivable
|
8,300 | 3,260 | ||||||
Regulatory Assets
|
27,391 | 21,485 | ||||||
Other
|
13,114 | 15,070 | ||||||
Assets of Discontinued Operations
|
29,692 | 197,269 | ||||||
Total Current Assets
|
399,596 | 513,663 | ||||||
Investments
|
11,093 | 9,708 | ||||||
Other Assets
|
26,997 | 27,356 | ||||||
Goodwill
|
39,406 | 39,406 | ||||||
Other Intangibles—Net
|
15,286 | 16,241 | ||||||
Deferred Debits
|
||||||||
Unamortized Debt Expense
|
6,458 | 6,444 | ||||||
Regulatory Assets
|
124,137 | 108,668 | ||||||
Total Deferred Debits
|
130,595 | 115,112 | ||||||
Plant
|
||||||||
Electric Plant in Service
|
1,372,534 | 1,332,974 | ||||||
Nonelectric Operations
|
310,320 | 288,479 | ||||||
Construction Work in Progress
|
54,439 | 41,976 | ||||||
Total Gross Plant
|
1,737,293 | 1,663,429 | ||||||
Less Accumulated Depreciation and Amortization
|
659,744 | 614,360 | ||||||
Net Plant
|
1,077,549 | 1,049,069 | ||||||
Total
|
$ | 1,700,522 | $ | 1,770,555 |
Otter Tail Corporation
|
||||||||
Consolidated Balance Sheets
|
||||||||
LIABILITIES AND EQUITY
|
||||||||
in thousands
|
||||||||
December 31,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
Current Liabilities
|
||||||||
Short-Term Debt
|
$ | -- | $ | 79,490 | ||||
Current Maturities of Long-Term Debt
|
3,033 | 225 | ||||||
Accounts Payable
|
115,514 | 102,537 | ||||||
Accrued Salaries and Wages
|
19,043 | 17,675 | ||||||
Accrued Taxes
|
11,841 | 11,749 | ||||||
Derivative Liabilities
|
18,770 | 17,991 | ||||||
Other Accrued Liabilities
|
5,540 | 5,608 | ||||||
Liabilities of Discontinued Operations
|
13,763 | 49,705 | ||||||
Total Current Liabilities
|
187,504 | 284,980 | ||||||
Pensions Benefit Liability
|
106,818 | 73,538 | ||||||
Other Postretirement Benefits Liability
|
48,263 | 42,372 | ||||||
Other Noncurrent Liabilities
|
19,002 | 21,004 | ||||||
Deferred Credits
|
||||||||
Deferred Income Taxes
|
177,264 | 155,436 | ||||||
Deferred Tax Credits
|
33,182 | 44,945 | ||||||
Regulatory Liabilities
|
69,106 | 66,209 | ||||||
Other
|
520 | 507 | ||||||
Total Deferred Credits
|
280,072 | 267,097 | ||||||
Capitalization
|
||||||||
Long-Term Debt, Net of Current Maturities
|
471,915 | 433,676 | ||||||
Class B Stock Options of Subsidiary
|
-- | 525 | ||||||
Cumulative Preferred Shares
|
15,500 | 15,500 | ||||||
Cumulative Preference Shares
|
-- | -- | ||||||
Common Equity
|
||||||||
Common Shares, Par Value $5 Per Share
|
180,509 | 180,014 | ||||||
Premium on Common Shares
|
253,123 | 251,919 | ||||||
Retained Earnings
|
141,248 | 198,443 | ||||||
Accumulated Other Comprehensive (Loss) Income
|
(3,432 | ) | 1,487 | |||||
Total Common Equity
|
571,448 | 631,863 | ||||||
Total Capitalization
|
1,058,863 | 1,081,564 | ||||||
Total
|
$ | 1,700,522 | $ | 1,770,555 |
Consolidated Statements of Cash Flows
|
||||||||
For the Year Ended December 31,
|
||||||||
In thousands
|
2011
|
2010
|
||||||
Cash Flows from Operating Activities
|
||||||||
Net Loss
|
$ | (13,243 | ) | $ | (1,344 | ) | ||
Adjustments to Reconcile Net Loss to Net Cash (Used in) Provided by Operating Activities:
|
||||||||
Net Gain from Sale of Discontinued Operations
|
(8,674 | ) | -- | |||||
Net Loss (Income) from Discontinued Operations
|
39,037 | (9,482 | ) | |||||
Depreciation and Amortization
|
70,000 | 69,399 | ||||||
Asset Impairment Charge
|
3,613 | 19,251 | ||||||
Deferred Tax Valuation Adjustments and Tax Rate Reduction
|
-- | 8,300 | ||||||
Deferred Tax Credits
|
(2,386 | ) | (2,715 | ) | ||||
Deferred Income Taxes
|
13,292 | 8,770 | ||||||
Change in Deferred Debits and Other Assets
|
(25,054 | ) | 30 | |||||
Discretionary Contribution to Pension Plan
|
-- | (20,000 | ) | |||||
Change in Noncurrent Liabilities and Deferred Credits
|
35,167 | 3,686 | ||||||
Allowance for Equity (Other) Funds Used During Construction
|
(861 | ) | (4 | ) | ||||
Change in Derivatives Net of Regulatory Deferral
|
72 | 208 | ||||||
Stock Compensation Expense – Equity Awards
|
2,177 | 2,923 | ||||||
Other—Net
|
1,258 | 1,836 | ||||||
Cash (Used for) Provided by Current Assets and Current Liabilities:
|
-- | -- | ||||||
Change in Receivables
|
(22,398 | ) | (33,603 | ) | ||||
Change in Inventories
|
(5,974 | ) | (7,386 | ) | ||||
Change in Other Current Assets
|
3,565 | (9,927 | ) | |||||
Change in Payables and Other Current Liabilities
|
(657 | ) | 23,138 | |||||
Change in Interest Payable and Income Taxes Receivable/Payable
|
(9,238 | ) | 40,971 | |||||
Net Cash Provided by Continuing Operations
|
79,696 | 94,051 | ||||||
Net Cash Provided by Discontinued Operations
|
24,687 | 10,966 | ||||||
Net Cash Provided by Operating Activities
|
104,383 | 105,017 | ||||||
Cash Flows from Investing Activities
|
||||||||
Capital Expenditures
|
(73,677 | ) | (61,549 | ) | ||||
Proceeds from Disposal of Noncurrent Assets
|
2,625 | 1,049 | ||||||
Net Increase in Other Investments
|
(40 | ) | (2,855 | ) | ||||
Net Cash Used in Investing Activities - Continuing Operations
|
(71,092 | ) | (63,355 | ) | ||||
Net Proceeds from Sale of Discontinued Operations
|
107,310 | -- | ||||||
Net Cash Used in Investing Activities - Discontinued Operations
|
(30,795 | ) | (21,812 | ) | ||||
Net Cash Provided by (Used in) Investing Activities
|
5,423 | (85,167 | ) | |||||
Cash Flows from Financing Activities
|
||||||||
Change in Checks Written in Excess of Cash
|
(8,463 | ) | 8,470 | |||||
Net Short-Term Borrowings
|
(79,490 | ) | 71,905 | |||||
Proceeds from Issuance of Common Stock
|
-- | 549 | ||||||
Proceeds from Issuance of Class B Stock of Subsidiary
|
-- | 153 | ||||||
Common Stock Issuance Expenses
|
-- | (142 | ) | |||||
Payments for Retirement of Common Stock
|
(1,182 | ) | (401 | ) | ||||
Payments for Retirement of Class B Stock and Options of Subsidiary
|
-- | (1,012 | ) | |||||
Proceeds from Issuance of Long-Term Debt
|
142,006 | -- | ||||||
Short-Term and Long-Term Debt Issuance Expenses
|
(1,666 | ) | (1,699 | ) | ||||
Payments for Retirement of Long-Term Debt
|
(100,958 | ) | (58,945 | ) | ||||
Dividends Paid and Other Distributions
|
(43,923 | ) | (43,698 | ) | ||||
Net Cash Used in Financing Activities - Continuing Operations
|
(93,676 | ) | (24,820 | ) | ||||
Net Cash (Used in) Provided by Financing Activities - Discontinued Operations
|
(1,827 | ) | 1,104 | |||||
Net Cash Used in Financing Activities
|
(95,503 | ) | (23,716 | ) | ||||
Less: Net Change in Cash and Cash Equivalents – Discontinued Operations
|
673 | (1,300 | ) | |||||
Effect of Foreign Exchange Rate Fluctuations on Cash – Discontinued Operations
|
(324 | ) | (566 | ) | ||||
Net Change in Cash and Cash Equivalents
|
14,652 | (5,732 | ) | |||||
Cash and Cash Equivalents at Beginning of Period
|
-- | 5,732 | ||||||
Cash and Cash Equivalents at End of Period
|
$ | 14,652 | $ | -- |